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Dell’Oro: Coherent DWDM to drive optical transport equipment revenue

Industry analyst, Dell’Oro Group has published its latest Optical Transport quarterly report. Amongst its findings, the report predicts that optical transport equipment demand will be $83bn over the next five years. This cumulative revenue is up 10%, says Dell’Oro, compared to the previous five-year period and will largely be from sales of coherent DWDM systems.

Additional highlights from the July 2023 forecast report include a raise of the DWDM long-haul forecast due to the growing need for network capacity and increasing use of integrated C+L band optical line systems. In addition, the firm says that demand for WDM equipment for metro and long-haul data centre interconnect (DCI) is likely to grow through the forecast period, with the majority of growth in long-haul systems. The report also detailed that a new generation of coherent DSPs to begin shipping in late-2023, and by 2027, nearly one-third of shipments will be comprised of DSPs that are capable of transmitting 1.2 and 1.6Tb/s signals over a single wavelength.

Jimmy Yu, Vice President at Dell’Oro Group says: "We slightly raised our outlook for optical transport equipment. We believe the demand for long-haul equipment is better than we had originally thought and while working on the report identified more items that could further improve future market revenues than lower them. At the end of the day, although year-to-year spending on optical equipment is lumpy, the direction for bandwidth consumption remains steady, pointing up and to the right.”

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